N.H. City Says Attorney Malpractice Nixed Insurance

A New Hampshire municipality has sued its former legal counsel for malpractice, contending that he not only failed to appropriately advise the city of Claremont of the legal risks associated with firing the city tax assessor in 2000 but also failed to advise the city that the tax assessor, Steve Snelling, intended to sue over his termination.

As a result, the city says in a malpractice suit against attorney John Yazinski and his law firm, Claremont’s insurance carrier refused to provide coverage for Snelling’s successful wrongful termination suit, reports the Eagle Times.

As the city documented in a termination letter allegedly approved by Yazinski, Snelling was fired, in part, because he criticized Claremont’s tax abatement program in comments made to the newspaper. He was awarded a little over $150,000 in compensatory damages for what was determined to be a violation of his First Amendment rights, according to the newspaper article and a Supreme Court of New Hampshire opinion (PDF) upholding the jury verdict in favor of Snelling.

However, that amount may not be final: A trial is scheduled in March on a damages remand issue, the newspaper notes. And the city was pursuing an unresolved declaratory judgment action against its insurance carrier, seeking an order requiring the insurer to cover the damages award to Snelling, the court says in its July 18, 2007 opinion. Although state law limits such damages against a municipality to $150,000, the limit reportedly doesn’t apply if damages are covered by insurance.